1. EU Funding Options and Financial Instruments 2014 - 2020 Presentation made from European Commission & EIB presentations

2. Convergence (Objective I) National Regional Regional Competitiveness and Employment (Objective II) National Regional Other Funding Sources EU Cohesion Funding Cohesion FundERDF European Social Fund ENPI IPA ETC (Objective III) C ross-border EU Wide networking Transnational EUSDR Relevant Funding Options

3. Danube region relevant funding sources 18 Cross-border co-operation Programs 11 EIB-linked facilities and instruments 15 regional Programs under Convergence Objectives 4 national Programs under Regional Competitivenaess and Employment Objectives 3 Transnational Co-operation Programs 8 IPA Cross-border Co- operation Programs with MSs 6 IPA Cross-border co-operation Programs for Accession Countries 3 ENPI Cross-border 3rd Country Programs Other Funding Sources 13 Regional Programs under Regional Competitiveness and Employment Objectives 32 National Programs under Convergence Objectives 4 EU-wide networking programs Bucharest, 30.01.2012 Danube Region Relevant Funding Sources – at least 106 programmes

4. A single package comprising: 1.European Social Fund (ESF) 2.European Regional Development Fund (ERDF) 3.European Agricultural and Development Fund (EARDF) 4.European Maritime and Fisheries Fund (EMFF) 5.Cohesion Fund (CF) 4 Structural and Investment Funds 2014-2020 - a package of funds

5. EU LEGISLATIVE PACKAGE (Regulations) ERDF, ESF, CF, EAFRD, EMFF PARTNERSHIP AGREEMENT ERDF, ESF, CF, EAFRD, EMFF National or regional level Operational Programmes for ERDF Rural development programmes (EAFRD) Operational Programmes for ESF Operational Programmes for CF EU level National level Multifund Operational Programmes for ERDF, ESF, CF Operational Programmes for (EMFF) "Structural and Investment Funds" 2014-2020 – shared management 5

6. Structural and Investment Funds 2014-2020 – key principles Principles guiding design of new funds: Align EU cohesion policy more closely to the Europe 2020 strategy Geographical concentration in less developed regions (as now) Increased thematic concentration in individual programmes on limited number of priorities Investments part of broader, well-founded strategies (ex-ante conditionality) Simplify implementation and improve links with other EU programmes 6

7. Budget Initial Commission Proposal (billion EUR) Revised Commission breakdown (billion EUR) – April 2013 Less developed regions162.6164.3 Transition regions39.031.7 More developed regions53.149.5 Territorial Cooperation11.78.95 Cohesion Fund68.766.4 Extra allocation for outermost and northern regions 0.91.39 Youth Employment Initiative (Top-up) - 3 TOTAL336.0325.2 7

8. 1.Research & innovation 2.Information and communication technologies (ICT) 3.Competitiveness of Small and Medium-sized Enterprises (SMEs) 4.Shift towards a low-carbon economy 5.Climate change adaptation & risk prevention and management 6.Environmental protection & resource efficiency 7.Sustainable transport & removing bottlenecks in key network infrastructures 8.Employment & supporting labour mobility 9.Social inclusion & combating poverty 10.Education, skills & lifelong learning 11.Institutional capacity building & efficient public administrations R&D target Climate change/energy target    Employment target Education target Poverty target  8 Thematic Objectives (with links to Europe 2020)

9. Financial operations and instruments in support of EU policies The Commission encourages the financing of investment in European enterprises and industries through a wide range of financial programmes and instruments. DG ECFIN is in charge of implementing a number of these programmes and instruments for financing investment from the Community budget. The funding is channelled through international financial institutions (IFIs) and through specialised programmes (e.g. for SMEs and Trans-European Networks). The main participating IFIs: the European Investment Bank (EIB) Group, including the European Investment Fund (EIF), the European Bank for Reconstruction and Development (EBRD), and the Council of Europe Development Bank (CEB) in co- operation with the Kreditanstalt für Wiederaufbau (KfW). DG ECFIN ensures the necessary coordination between the Commission and the EIB Group and the EBRD, and is represented on the governing bodies of these institutions. Financing Options (EU, national, IFIs)

10. A political priority (Europe 2020, Communication on a Budget for Europe 2020) Effective way to support Europe 2020 objectives of smart, sustainable and inclusive growth 3 types of benefits – Financial leverage – multiplication of scarce budgetary resources by attracting additional finance – Policy impact – financial intermediaries pursue EU policies – Institutional know-how – EU can use the resources and expertise of financial intermediaries EU Financial Instruments - why?

11. 11 High-Medium Financial Profitability, Low risk Positive Economic rate of returns Commercial loan, (Including EIB loan) EU budget grant Joint Instrument e.g. credit enhancement Project characteristics Potential Blending area Funding instruments High-Medium Financial Profitability/ High risk Low or negative financial profitability Cohesion Agri Research IPA/ENI National public funds EU Financial Instruments – when ?

12. Equity / risk capital: e.g. venture capital to SMEs with high growth potential or risk capital to infrstructure projects. Guarantees to financial intermediaries that provide lending to e.g. infrstructure projects, SMEs, people in risk of social exclusion. Other risk-sharing arrangements with financial intermediaries in order to increase leverage capacity of EU funds. Or a combination of the above with oter of EU financial assistance. What are EU Financial Instruments ?

13. Financial Instruments included in 2014 – 2020 MFF proposals Centrally managed by COMShared management Research, Development, Innovation HORIZON 2020 Equity and Risk Sharing Instruments EUR 3.5bn Instruments under Structural and Cohesion Funds EU level Off the shelf instruments Tailor made instruments Significant higher amounts than currently Growth, Jobs and Social Cohesion Competitiveness & SME (COSME) Equity & guarantees EUR 1.4bn Creative Europe Guarantee facility EUR 0.8bn Social Change & Innovation Microfinance EUR 0.3bn Erasmus for all Guarantee facility EUR 0.8bn Infrastructure Connecting Europe Facility (CEF) Risk Sharing (project bonds) and equity instruments EUR 40bn

14. Financial Instruments included in 2014 – 2020 MFF proposals

15. EU Financial Instruments current and new EQUITY INSTRUMENTS FOR SMEs 2007-2013 High Growth and Innovative SME Facility (GIF) under the Competitiveness and Innovation Framework Programme (CIF) – EUR 0.6bn  GIF 1 – invests in seed, start-up and early stage SMEs  GIF 2 – invests in expansion-stage SMEs EQUITY INSTRUMENTS FOR SMEs 2014-2020 EU Equity Financial instrument for EU enterprises growth and RDI Equity Instrument for research and innovation - early stage funds, funds-of- funds that invest in intellectual property, technology transfer or venture capital Horizon 2020 Equity facility for growth - investments in expansion stage funds-of-funds that invest in venture capital COSME

16. EU Financial Instruments current and new DEBT INSTRUMENTS FOR SMEs 2007-2013 SME Guarantees (SMEG) under the Competitiveness and Innovation Framework Programme (CIF) – EUR 0.5bn Risk-Sharing Instrument (RSI): a dedicated compartment for SMEs under the RSFF created in 2011 – EUR 120m DEBT INSTRUMENTS FOR SMEs 2014-2020 Debt instrument for EU enterprises’ growth and RDI Loan Guarantee Facility -Guarantees and securitization of loans up to EUR 150.000 -Indicatively EUR 0.75bn COSME RSI – II Facility -Guarantees for R&I SMEs on loans above EUR150.000 Horizon 2020 Cultural and Creative Sector facility (new) - Guarantees for loans to creative and cultural entities. EUR 0.2bn Creative Europe

17. EU Financial Instruments current and new DEBT INSTRUMENT FOR LARGE R&D PROJECTS 2007-2013 Risk Sharing Finance Facility (RSFF) under FP7 Loans and guarantees to R&D projects EU budgetary allocation to large projects and research infrastrucutre (excluding the SME compartment) EUR 0.9bn DEBT INSTRUMENTS FOR LARGE R&I PROJECTS 2014-2020 Loan & Guarantee Service for Research and Innovation Loans and Guarantees to R&I (non- SMEs) Horizon 2020

18. EU Financial Instruments current and new EQUITY AND DEBT INSTRUMENT FOR THE SOCIAL ECONOMY 2007-2013 European Progress Microfinance Facility (EPMF, ets. 2010) guarantees and counter-guarantees for microcredit lending Loans and equity to microcredit institutions EU budgetary contribution EUR 100m EQUITY AND DEBT INSTRUMENTS FOR THE SOCIAL ECONOMY 2014-2020 Microfinance and social entrepreneurship instrument Guarantees, micro credit, equity and quasi- equity to financial institutions that invest or lend to entrepreneurs, especially those furthest from the labour market, and social enterprises. Proposed EU budgetary contribution Access to microfinance EUR 87m Social enterprise development EUR 96m Capacity building EUR 9m Social Change and Innovation

19. EU Financial Instruments current and new INSTRUMENT FOR INFRASTRUCTURE 2007-2013 Loan Guarantee Facility for TEN-Transport (LGTT, est. 2008) EUR 500m of EU budget has generated EUR 12bn of project financing Pilot phase project bonds EUR 230m budget for 2012-13 EQUITY AND DEBT INSTRUMENTS FOR NFRASTRUCTURE 2014-2020 Infrastructure financial instruments (including Project Bonds Initiative) Equity instruments, such as investment funds with a focus on providing risk capital for actions contributing to projects of common interest; Loans and/or guarantees facilitated by risk- sharing instruments, incl. enhancement mechanism to project bonds, issued by a financial institution on its own resources; Thematic coverage: TEN-T, TEN-E and broadband Other financial instruments EUR 40bn Connecting Europe Facility

20. EU Financial Instruments current and new DEBT INSTRUMENT FOR STUDENTS Student Loan Guarantee Facility Guarantees for student loans EUR 0.8bn Erasmus for all

21. EU Financial Instruments current and new COHESION POLICY 2007-2013 Currently approx. 5 % of ERDF delivered through financial instruments. COHESION POLICY 2014-2020 In 2014-2020 use of financial instruments in cohesion policy will expand to all thematic objectives and priorities foreseen by OPs, provided that economic viability of final recipient / repayment capacity of projects is demonstrated. Combination of financial instruments and support, e.g. grants, will be strengthened. CSF funds may contribute to support financial instruments set up at Union level managed directly / indirectly by COM in line with FR. OP contribution to be ring-fenced for investments in regions and actions covered by OP. Cohesion fund will for the first time be open to financial instruments. Volume of ERDF resources that could potentially be delivered through financial instruments could increase up to 3 times.